Bond markets and currency hedging (II)

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31.7.
Carry Traders Are Using Weak Euro to Win Big in Emerging Markets
https://finance.yahoo.com/news/carry-traders-using-weak-euro…
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For carry traders battered by the dollar’s rally and higher US borrowing costs, the euro’s worst plunge since 2005 couldn’t have come one moment sooner.

Investing in emerging-market currencies with borrowed euros is raking profits of as much as 29% this year depending on the choice of the higher-yielding currency, according to data compiled by Bloomberg. The gains are being driven by the euro’s 10% drop against the dollar, which took the cross to parity for the first time in two decades.

Those who funded the same carry positions with the greenback had much less lucrative results: not only the overall strategy is failing for a third successive year, but most individual emerging-market currencies are also producing losses. Even in Latin America, profits have stalled after a stellar start. Needless to say, traders are switching.

“Funding carry trades by selling euro is becoming more common,” said Brendan McKenna, a currency strategist at Wells Fargo in New York. “The European Union looks more likely to fall into recession and geopolitical developments should weigh on the currency, making emerging-market carry trades funded by the euro an interesting option.”
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an dieser Fragmentierung von WO-Threads bin ich nicht schuld; das hier war eine Entscheidung anderer Leute:
https://www.wallstreet-online.de/diskussion/500-beitraege/13…